Fujitsu Ltd. said Tuesday it will end its hard drive head business at the end of March and book a one-time loss of around ¥5 billion for the October-December quarter to close down the operations.
Fujitsu is believed to be in negotiations to sell the loss-making business to Toshiba Corp. as it grapples with the deepening fallout from the global economic slowdown.
While admitting discussions are still ongoing on the future of the hard drive business as a whole, a company spokesman said Fujitsu decided to withdraw from the specific operation of making heads because it is unlikely to reap a profit in the long term and because it would be difficult to find a buyer for that business alone.
Fujitsu said around 360 employees working to develop and manufacture the key hard drive part used to read and write data will be transferred from Nagano Prefecture to other sections. The firm will continue its hard drive business for now by buying the component externally.
The Nagano plant will continue operations after March 31 to make printed circuit boards for servers and telecommunications equipment.